The self-fulfilling prophecy is, in the beginning, a false definition of the situation evoking a new behavior which makes the original false conception come true- Robert K. Merton

Merton’s self-fulfilling prophecies are as prevalent today, as they were when he coined the phrase in 1948, and expressed that we live in a nation where dark clouds of despair are becoming darker, where prophets of doom understand the more they scream, the greater the likelihood there dire warnings will come true.  For me, the greater risk is the former.  We live in a nation with slumped shoulders that cannot produce an economy that maximizes potential and create widespread prosperity.

The NBC/WSJ survey underscored things we thought were going on, and were shocked and amplified by the notion there is a leadership and confidence crisis.  The country is not in a recession. There are forces moving it in the wrong direction from excessive money printing to ideological-driven policies that have gut our work ethic, and have removed rungs from the ladder of success.  Nonetheless, when there are overarching feelings of hopelessness our destiny will curve in that direction.

71%	Country moving in wrong direction
71%	Somewhat to very dissatisfied with economy
49%	Believe the country is currently in a recession

There is a silver lining.  I do not think Americans are ready to ditch our economic system, despite non-stop badmouthing from the White House to the mass media.  People see Washington D.C. as the issue, not income inequality, low minimum wage, or other “ills” of capitalism, which is great news; we can always throw the bums out.

71%	Elected officials in Washington hurting economy
23%	Longstanding problems hurting economy

Of course, disliking elected officials and knowing they are selling us down the river is a lot different from  tossing them out, which is something we fail to do when it comes to our very own elected officials.  Nevertheless, I am more encouraged with the idea that only a fraction of people surveyed sees longstanding problems holding back the economy.

White Flag for White House

For all the populist rhetoric that comes out of the White House each day, it is remarkable how much  falls on deaf ears.  President Obama’s overall approval numbers has crashed since his first month in office.

President Obama’s Approval Swoon Song	Feb 2009	July 2014
Overall	60%	40%
Economy Policy	56%	42%
Foreign Policy*	56%	36%

*April 2009

"The American people don't want me to sit around twiddling my thumbs, getting nothing done."

If President Obama was bothered by the NBC/WSJ poll, he did not show it last night during his press conference.  When asked about being an imperial president, and just how far he is willing to go to get the job done without Congress, his reply:

“What I am consistently going to do, is wherever I have the legal authorities to make progress on behalf of middle class Americans and folks working to get in the middle class … I’m going to seize those opportunities and that’s what I think the American people expect me to do.”

It is beyond tone deaf to ignore elected officials, and those American voters who put them into office if they are not willing to play ball.  In many ways, we could be watching a coup d’état in Washington D.C., with the President declaring himself the peoples' leader.

Without a doubt, such thinking is not going to make the public feel any better, but I guess the good news is they cannot feel any worse.

The most damning part of all of this is the fact that now 76% of American parents think their children will be worse off financially than they were. It has been something of a rite of passage that each generation does better than the previous one.

Sell-off or Head fake?

This specious validity of the self-fulfilling prophecy perpetuates a reign of error.  For the prophet will cite the actual course of events as proof that he was right from the very beginning - Robert K. Merton

At some point, the market will get hit, but there is a huge difference between pullbacks, corrections, and crashes.  Lots of people have gotten into the crash prediction business, which affects the behavior of investor’s.  Still, yesterday was an odd session, even odder than Monday, if the Dow was off 300 points, it would have been understandable.

Today’s Session

Today should be another interesting day of trading. We received some good news from the Bureau of Labor statistics regarding jobless claims. Initial jobless claims came in lower than expected for the week ending August 8^th at 289,000 compared to consensus at 308,000. Continuing claims which lag by one week came in at 2.518 million for the week ended July 26^th, lower than the upwardly revised 2.542 million observed in the prior week and consensus at 2.525.

Earnings results by major companies were mixed this morning; a lot of companies missed on earnings. Below are some of the major players in the market.

Comments

Is there any doubt that politicians of both parties are ruling from self-interest, with some exceptions. We need to toss most of them out and that would be easier if the mainstream press would actually report the news. Thank goodness for Fox. They were smart enough to hire Charles Payne et all! karen mcfadden on 8/7/2014 7:27:24 AM

The out of control spending and welfare push by Washington is killing America. Also, Obama's blind eye to the defense of America as well as open borders and minimizing terrorists is driving us down as a nation! George Dodson on 8/7/2014 9:10:11 AM

Really - better off IF Washington begins changing in November and then gets presidency in 2016. Otherwise, if Republicans snatch defeat from the jaws of victory and keep killing each other, my children will be worse off. Pam on 8/7/2014 9:25:52 AM

The people have the ability to change the direction of our country. Unless we have the courage to suffer some hardship the kids won't have a chance. Frances Wiggins on 8/7/2014 10:57:50 AM

We seem to be building a nanny state, with entitlements programmed in. It is endemic in many of our institutions, especially our educational system (which has been severely downgraded and critical thinking is no longer taught). To have a system that gives monies to people with out getting any labor/production or out put from them is just stupid. Those on the so called left feel that it is good and proper to do this. No person should be given anything for free. It robs people of dignity, integrity and the needed drive better their lot through smart hard work. It is more than a lack of leadership that has befallen us, it is a misguided sense of direction and "fairness" that is extremely unfair and damaging. My children will have a better life, I have taught them well. I hope that they teach their children well. I did not leave it up to the educational system to educate my children, I took it upon myself to be very involved and to implement separate instruction where necessary and guide/monitor their overall instruction. There will be enough people that want to succeed so that commerce will carry on. Those that get caught up in the nanny system will not succeed, but will cry a river at the unfairness. David Huber on 8/7/2014 10:59:39 AM

Welfare, SDI, unemployment benefits all must be addressed, education needs to stress each childs goals and interests and then give that child the skills to pursue his goals, not expecting that government will take care of him Charlene Voss on 8/7/2014 11:40:36 AM

Banks paid back their loans (TARP) at a profit to the Feds; they carried an interest rate of 5% and Fed took preferred stock. Loan not Bale out. Regulations and bureaucrats with their political enablers are killing this country. Our system of Government is broken and broke. Beeeson on 8/7/2014 1:01:22 PM

If BO can make exceptions to ACA then why can't he make exceptions to lower tax and help Americans and American business. If it is patriot capitalism to not do an inversion why is it not patriot capitalism for government to lower taxes? john loewen on 8/7/2014 2:07:51 PM

4O,OOO people possibly dying in Iraq. and what is Obama doing, considering humanitarian aid. Oh my God... we have the air power why aren't we using it. Blow Isip to kingdom come and then there is Mr. Putin, Obama's beloved friend.... Charles, the world is about to blow up in our face, even the German economy is down and out, what next ?????? Tom thomas r wayne on 8/7/2014 3:17:51 PM

They'll be better off, not because of any speculative and likely ineffective political exertions, but because the young have strength, they believe, and they will figure out their world. Patricia Flynn on 8/7/2014 3:30:29 PM

Our founding principles hold, and will work for the common good, if the electorate becomes informed and elects competent, serious-minded candidates to enact sound policies and govern in the nation's interest. So, there can be better days if Washington changes. Don Highlands on 8/7/2014 4:35:37 PM

Dear Charles, Has a president ever been "recalled" because of incompetency? Carolyn D on 8/8/2014 12:55:24 PM

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